Many homeowners and businesses affected by Hurricane Sandy find themselves confronted with impossible obstacles as they try to receive payouts from their insurance policies, including one small business in Lower Manhattan that has been struggling with its claim. NY1's Susan Jhun filed the following "NY1 For You" report.
The Space Salon in Lower Manhattan had plenty of space after it lost power and was forced to close for a week following Hurricane Sandy. The closure placed a huge financial strain on the small business which estimates a $20,000 loss.
"Cash flow is so important to us and every week is important," says Space Salon Owner Janette Bower.
The husband and wife co-owners filed a claim with their insurance company, Utica National Insurance Group, for business interruption but were denied.
"There seems to be this grey area that the insurance companies are manipulating," says Bower.
The grey area falls over what's considered a mandatory closing by a civil authority. The salon's building which had no power was deemed unsafe and closed by the building manager based on city fire code.
"New York City code is a law," notes Bower.
But according to the owners their insurance company doesn't see it that way. NY1 contacted Utica and a spokesman said he couldn't speak about the specific details of the claim. However, he said an additional review of the claim was conducted based on the station's inquiry. He went on to say the original decision was found to be correct because the coverage provided under the policy does not respond to this type of loss.
"When we took out the policy, we wanted to be covered for business interruption," says Space Salon Owner Norman James. "It seems like they have lawyers that write these things out and everything's so opaque that they can just find a way to get out of it you know depending on the wind, depending on all these little things and you know what we're not playing a game here. We're buying insurance. We want to be insured and we want to sleep at night."
NY1 contacted the Department of Financial Services which oversees insurance companies and a spokesman said they are now looking into the matter.
"NY1 For You" will continue to follow the story.